Cry Halt!
The Changes taking Place in Our Society and the Role of Food Banks

by Ian Ritchie

"The relationship between the public and voluntary sectors used to resemble a partnership. Now it is increasingly developing traits of an abusive relationship -- with the Government repeatedly dumping on the voluntary sector ..."

SOCIETY IN NEW ZEALAND is undergoing massive change. The process began many years ago and has some way to go. The changes are being carried out under the guise of more efficient management and balancing the books. While this may be part of the outcome, it is far from the whole. The changes have radically changed the nature of the economy but what is generally ignored is that they are radically changing the nature of our society. The collective/co-operative components of our society are being dismantled and are being systematically replaced by the ideology of individualism with the market place being the mechanism for dealing with most issues.

Government interest in the welfare of the people is steadily reducing and this role is steadily being left to the voluntary sector. The ability of the voluntary sector to meet mainstream social needs is strictly limited. The gap between the rich and the poor is wide and widening. The consequences of inadequate food and shelter for some, and the lack of financial and emotional security for many, are growing and are showing up as poverty diseases, stress related illnesses, some of which are increasingly terminal, growing illiteracy, and a general rise in the levels of fear, depression and anxiety.

The voluntary sector has always been involved in these areas, but never as the dominant provider. As this role is de facto left to the sector, many changes are taking place. The growth of food banks is the most obvious and is probably one of the best and most sensitive indicators of social well-being.

Whether the place of Food Banks becomes institutionalised is an important issue for behind it lies the endorsement of the new model of society.

In some respects the relationship between the public and voluntary sectors used to resemble a partnership. Now it is increasingly developing traits of an abusive relationship with Government repeatedly dumping on the voluntary sector. This situation will continue until the community and the voluntary sector organisations cry halt! I consider they have the power to do that.

Introduction

New Zealand Society is undergoing massive change at the moment, and has been for quite some time, and the changes are likely to continue for many years to come. The most fundamental of these changes will have far reaching implications for our society, and particularly for the voluntary sector.

Food Banks, to me, appear as an important indicator of the well being of a significant section of our society. They have considerable importance because of this and therefore have a very significant role to play.

The model of government being implemented in New Zealand is that the role of government should be, in Jane Kelsey's words, "rolled back" to that of only providing policy. The dominant force and mechanism for doing things in the economy and of course right across society, is to be "the market". The market will produce and provide. Everything else, and most of us know that there are substantial areas that fit into this category, is to be done by the voluntary sector.

I want to briefly outline three ways the Government is rolling itself back: asset sales, reduction of services and tax cuts.

Asset Sales

The Government is steadily and resolutely selling off publicly owned assets. This is being done under the guise of debt reduction, but as most of us are aware, this has had very little influence on the level of debt. The debate over the sale of the cutting rights of the Forestry Corporation clearly demonstrated that it was done for ideological reasons, that Governments should not run businesses, and that other arguments were camouflage. In this way, Government is handing over profitable/trading activities and other assets to the private sector.

Reduction of services

The Government is steadily winding down the services it provides. The Children and Young Persons Service is being steadily squeezed for funds, and staff cuts are used to balance the books following cost over runs. With every staff cut goes a service reduction and we hear frequently of the effects of this. The Ministerial jibe is that they must become more efficient.

Funding cuts to The Police Force have also meant service cuts and the Auckland District Commissioner has spoken out about these. Small stations are now looking for volunteers to staff them and keep them open1 and charity funds are sought for basic equipment such as cell phones2.

In the Justice area, it is no coincidence that the day the restructuring of the Department with the downgrading of Head Office to a policy unit, the intention to establish private prisons was announced.

The change from responsibility for programmes to developing policy meant a change in the Chief Executive in Youth Affairs and other ministries, and the latest casualty to this process was the national co-ordinator of the Cervical Screening Programme.

In the field of education, funds are steadily being squeezed with the monies allocated per head of population being steadily reduced, with the emphasis on user pays on the grounds that the individual is the one who benefits. Schools and universities, at the opposite ends of the spectrum, are being pushed into a corporate model which can then be privatised, and the previous Minister indicated that he saw no reason why this should not happen.

Exactly the same has happened in the health sector. Government policy is to build up the private health sector. Public money is being used to do this and in the process the public health system is being deliberately run down. The maintenance of hospitals is well behind, the services available within and without are being withdrawn and restricted and professional staff are being replaced by lesser trained people. The money allocated to health is going up but that is an integral part of the process.

As Maurice Williamson pointed out at the recent Telecommunications conference, competition goes with high prices (for high prices read high profits). Rodney Hyde of ACT, remarked that if the Alliance got into power and reduced the level of charges Telecom could make, eg for line rentals, the competition would disappear. Thus high prices, high profits, are necessary for competition. With corporatisation and privatisation of public services, prices must rise significantly with the requirement to generate a return on the capital invested.

That is why the health vote is increasing, despite the reduction in services. But we hear of new private sector health providers who have little expertise either in the business sense or the medical services sense and another consequence of this is a further reduction of services. In Palmerston North we now have an after hours Manager at the Hospital. Why? One possibility is that the underfunding of services means that more are available only during normal working hours.

The cost of administering the health system used to be less than 10%, now it is over 20%, with much of this going into the beaurocratic machinery that focuses on economic efficiency rather than the provision of health services, and in addition, to controlling the phasing out of the public system and the building up of the private system.

Of course, the more the public services get run down, the more the pressure mounts to phase them out entirely because of the antagonism generated by the inadequacies of the system. This is also the thrust of the campaign with ACC.

The Coalition for Public Health considers that the steps to privatisation of the health system (including a private RHA) will be complete by the year 2000 if present policies continue, despite the fact the Ministers and various commentators have said that the privatisation of the health system has been given away, as early as 1991, none of the facts support this. The whole process is on stream: the people driving the changes are still there. While the buildings might still be publicly owned, significant services within them are not and whole sections of the health system are being handed over under the guise of managing care, efficiency and containing costs. This increasingly means the control of services by the funder, insurance companies, with consequent reduction in the breadth, depth and quality of services which are accessible to fewer people. The supposed answer to the access issue, the Community Services Card, has already been found to be seriously flawed3.

Health is no longer the focus. Service is no longer the focus. Profit is all important and at the Health Summit in Palmerston North recently we heard of one nursing home where newspaper is used instead of plastic under the sheets on beds for incontinent patients and plastic bags and glad wrap are used instead of plastic gloves. The bottom line is all important.

What can we do about this? Very little and less and less if we stick with earlier modes of action because traditional political accountability is no longer the function of the political and democratic process. Accountability, in the market, is about economic efficiencies, acceptable rates of return on capital invested, and profit, as affected by customer preferences on a competitive playing field.

How competitive is the playing field? The relationship between Telecom and Clear spells out quite clearly that the playing field is not level and that the Government will not intervene to make it so. I doubt if it will in the argument between Telecom and the small Internet Access Service providers.

While competition works in some areas, and reduces prices in some, the basic requirements for this to happen are not met with natural monopolies which most public services are. The playing field is far from level and public services were developed in recognition of this and the fact that the market does not provide equity or common goods. The whole, economic rationalist or free market philosophy represents a denial of community and political development over the past century.

While the corporatised public agency in some cases bears a strong resemblance to its predecessor, the function and role may be radically changed. With the corporatisation of the Electricity Department went the removal of the obligation to guarantee the supply of electricity. The Housing Corporation used to act as a restraining influence on the level of house rentals. The Ministry of Housing has taken to leading the market in setting rentals.

The Tax Cuts

Tax cuts are another means by which Government is opting out of financing public services, by handing purchasing power over to the individual. An associated issue of course, is that the major beneficiaries are the wealthy.

Growth and Employment

With the government steadily withdrawing from significant areas of management of the economy, leaving it to the market and the Reserve Bank, nobody has any responsibility for the provision of either services or jobs. The Government has no growth or employment policies or goals. These are left to the market. But companies are in business to make a profit, not to provide jobs. The much vaunted job creation figures we are fed, are another illusion. Most of them are under the control of foreign companies and can go as quickly as they came: foreign capital knows no allegiance to any country. Further, the level of unemployment has not fallen below that of the early 1990's and is nowhere near that of the mid 1980's, when the Employment Summit was held because unemployment had reached crisis levels. Cutting public sector jobs does nor create private sector jobs. It simply cuts services and increases unemployment to the detriment of the whole community.

Restructuring stopped the economy in its tracks. The "economic miracle" gave us about 6% growth for less than two years. The headlines in the papers over the last two months as economic growth sank to nearly 2% have been about 'collapse' and 'recession'. Unemployment is starting to rise again with a marked increase in the frequency of major layoffs. The real level of un- and under-employment is at least twice and probably three times the official figures4 and remember that the levels of youth, Maori and Pacific Island unemployment are already three times the average.

Jobs are increasingly casual and short term and the Employment Contracts Act brought in in 1991 has further helped to severe the links between pay for work and the necessary income to live by removing the award structure and allowing pay rates to fall below those previously determined as appropriate for that class of work.

New Management systems

Government has introduced a management and contractual relationship with voluntary organisations which is based on a limited number of very specific 'outcomes' which can be very easily monitored and changed, is very oppressive and controlling. In what is probably intended to be a transition phase, these contracts are generally under-funded with funding in some areas, well below the real cost of the service contracted for. In some areas, the expectations on the voluntary organisation are far greater than those on the equivalent or related government service.

The impacts on people

Estimates of the effects of these changes for workers in Canada4, with the same logic and similar circumstances to those applying here, are that there has been a 25% loss in earning power. A third of the remaining wage income is taken up by increased charges, many being the individualised costs of previously publicly funded and provided services.

The 1991 benefit cuts reduced the income of most beneficiaries by around 20%. Since then, while benefit levels has risen a little, basic costs such as rent, rates, power and telephone costs have risen by 50% since then with rent of course being the most important.

The increasing trend to user pays health and education and now escalating housing costs means that the level of inequity in general and in these areas specifically, will widen and become structural as opportunities decline for people on a benefit with few reserves to improve their situation or expectations. The move to individualise the provision of financial security including retirement income will further widen the gap between the wealthy and the poor.

While the Government repeatedly declares our changed society to be an 'economic miracle', the reality is somewhat different. The point of an economic miracle must surely be that people are better off or going to be. There are few signs of this. There are plenty of signs of the opposite.

The level of new admissions to prison for serious violent crime trebled from 1985 to 1993 and if this growth continues, it is predicted that we will need to double the prison capacity by the year 2010 (Triggs, 1995). Almost one in four of the working age population are dependent on state support (DSW 1995). One in five of all New Zealanders and one in three of all New Zealand children live below the poverty line which is defined as 60% of the median equivalent household disposable income. The incidence of poverty among Maori and Pacific Island families is two and a half times greater than these overall levels. (Stevens, Waldegrave & Frater, 1995).

The level of poverty is steadily increasing and the gap between the 'haves' and 'have nots' is being progressively widened largely through cuts in both benefits and taxes. The consequences of inadequate food and shelter for some, and the lack of financial and emotional security for many, are growing and are showing up as poverty diseases, stress related illnesses, some of which are increasingly terminal, growing illiteracy, and a general rise in the levels of fear, depression and anxiety.

More jobs are not the answer, even if they might eventuate. The private sector has never produced enough jobs for any society and is less likely to now. Profit is their goal, not jobs and manufacturing units are located where labour and environmental protection costs are low. Free trade means that these low wage rates are imported into our own country under the guise of competitiveness.

What are the implications of this for the voluntary sector?

These are two fold. Firstly the voluntary sector is the sector designated to pick up the pieces left behind by the withdrawal of central government. Previously the voluntary sector provided services which filled in the gaps between those which were publicly funded and were provided by government agencies. Now these services are becoming main stream, and are in danger of becoming institutionalised. The voluntary sector agencies are now moving into the area that once were totally publicly funded and provided by government agencies.

Secondly, some writers (Rifkin, 1995) are suggesting that the voluntary sector will provide the jobs of the future that the private sector cannot. How this might be done and under what conditions are areas of major concern. We all know that there is plenty of work to do, particularly in meeting people needs, the difficulty is that those who need support cannot pay. It has to be a function of the collective. Without adequate funding and payment for work done, the concept is a nonsense.

Food Banks

I see food banks as an indicator of the level of well-being in the community. It is almost now a point of pride in some areas that people are running a food bank. "We are meeting the needs of our local people." In Feilding, my nearest township, with a population of about 17,000, there were 8 food banks in the latest count that I am aware of.

Is that a good thing or a bad thing? That depends on your perspective. If we are into alleviating the effects of poverty, perhaps it is a good thing, But does providing some food for the table occasionally actually alleviate poverty.?

There is a need to step back from your every day activities and see your work in a broader perspective.

What are the objectives of your organisation? Do they include something like: to improve the quality of life of our clients? Does a Food Bank really do this?

Government policy is steadily and firmly easing us into a totally user pays, individual responsibility society with caring for each other based on the charity model. Now that the link between income from employment and the costs of meeting basic living and lifestyle needs has been broken through the implementation of the package which included the Employment Contracts Act ( no awards, no cost of living adjustments, jobs increasingly casual or part-time), the gap between income and costs can only widen, poverty can only increase if we continue to go down the present path.

Community Response

What role are members of our community playing in this?

The Fire Service is being steadily moved down a track whereby a major proportion of the service which used to be predominantly publicly/collectively funded is now being increasingly provided by volunteers. The Fire Service is now becoming a member of the voluntary sector. The willingness of members of the community to join the Fire Service enables the Government to go down this track.

I consider that the willingness of people to provide food, organise shelter and other basic necessities, including health care, allows the Government to continue to reduce the collective component of responsibility for meeting not only the basic needs but also the common good needs right across our society.

Under collective responsibility to public funding, all of us contribute, not just in the provision of the safety net but right across the board, to the arts, sports and tax credits to the corporate sector.

The funding from government sources for voluntary sector agencies is being steadily reduced. In some areas it is down to a quarter of the cost of the service provision. The Community Funding Agency considers such an approach an investment, with a three to four-fold return. Who pays the balance? There are general indications of donor fatigue and withdrawal.

The cuts in services and funding fall most on the communities which have the least resources and the greatest needs.

Further, the provision of the safety net is now being reformed to a concept which we are led to believe fosters dependency. Welfare now equates dependency. So welfare provisions are being cut, and their accessibility reduced. The whole approach is now oppressive and repressive.

The whole of the system is in the restructuring basket, and overseas this has included Superannuation5. None of the present publicly funded services are exempt regardless of what we might like to think.

The Government can do this only to the extent to which we, you and I, as individuals allow them to, the extent to which we go along with the concept that the individual is all important and that the collective does not exist.

If we in the voluntary sector, and the food banks in particular, are endlessly prepared to pick up the consequences of the rolling back of the state, they are being given an open invitation to continue.

All power to the Richmond Fellowship and other organisation, including some church agencies, for saying no.

Over the last 10 to 12 years I can remember people in the social service agencies saying "we cannot cope any longer" several times. But each time they learnt how to. But volunteers are becoming increasingly hard to find and donor withdrawal is becoming significant. What is the end point?

Do you consider you have the capacity to replace government agencies to meet the breadth of needs in the community, with user pays funding as the basis for this? One of the Charitable Trusts which gave major financial assistance to the voluntary sector over the years, wound up under the increasing pressure form both the voluntary agencies and the finance and resource starved ‘public’ agencies including schools. If they could not meet the demand, how can we?

As I see it, food banks are on the cutting edge. This gives you tremendous leverage. If you cry halt. Things would change and they would change quickly.

The movement to withdraw benefits, the safety net, is international, with the intention of placing responsibility with the individual. The concept of the deserving and undeserving poor is also openly discussed. Do we go along with that? Which side of the fence do we sit on? Or are we sitting there saying "I don't want to know!" and I know many voluntary welfare agencies and their members adopt that stance.

If we do not want to know, we are colluding with the destruction of the collective component of our society, the fostering of the concept of the undeserving poor and promoting a victim/rescuer mentality.

Unless the policies and particularly the people implementing them are changed, the trends will continue to unfold as they are well embedded already.

Conclusion

The change over from a public to a private health system is anticipated to be by the year 2000. That for the winding up of the state and its public services has been talked about as the year 2010. These changes can only take place if we do not prevent them. Many people and groups do not even want to consider the issues involved. It will not be long before we will have no choice.

Food Banks are in a very strategic position in this debate. It is not possible not to be involved or to take sides. Your presence means you are involved. What you do is of fundamental importance.

When I worked as a small business advisor, one of the questions we asked people to think about is: "What business are you in?" I suspect that most of you will say "we are in the business of alleviating poverty". Is putting food on the table occasionally really doing that? I also suggest to you that you offer benefits to another, very different 'client' (the one who 'contracts' your services - the Government). You relieve them, representing the collective component of our society, of responsibility for meeting needs that can only be adequately met, collectively. Is that what you actually believe in?

The private sector has never, and is now much less likely to ever provide enough jobs for everyone who would like a job. As a major part of our commitment to each other, the State, through the public sector, has a legitimate and essential role in both supporting the private sector and in ensuring that the needs of all are adequately met; providing the basics of citizenship: dignity and the freedom from fear, of illness, poverty and old age. (Previous Governments have endorsed international conventions on these.) Food Banks represent charity, the antithesis of dignity.

While generosity is an important and highly valued human attribute, it is not appropriate to make it and the voluntary sector, particularly Food Banks, the safety net for society.

The operation of the collective component of our society must not be limited to just setting policy for recommending to independent business units, including those in health and education, guidelines for their operation and behaviour. The collective component of our society is a crucial and fundamental one. It is currently being phased out. This has massive and far reaching consequences for the social needs of the people in or communities.

The voluntary sector is not an acceptable substitute. We need partnerships at all levels to meet the challenges of the rest of this decade and into the beyond, and we need to restore the collective.

Where do you stand on this? What weight do you place on these issues within you organisation?

While the topics for the workshops tomorrow range from food co-operatives to the concept of a publicly funded basic income for all citizens, The rationale for them is very different. I urge you to also take the opportunity to spend time dealing with the strategic question of where do Food Banks fit in the overall scheme of things and what can be done about the changes taking place in our society.

Notes

1. eg Newtown, City Voice, 14.3.96

2. Patea, Patea Mail

3. see report on Master of Health Science study by Park, 1996, in the Child Poverty Action Group Backgrounder No 2. July 1996.

4. refer to "Working Harder Isn't Working", O'Hara, New Star Books, 1993, Ch 4, and "Labour market disadvantage, deprivation and mental health, Benefit Agency?" D Fryer, 1994 C S Myers Lecture. The Psychologist, June 1995.

5. see "World Bank helps attack pensions in the South" in PSI Focus, Sept 1995. In 1992, pensions in Argentina were cut to less than half the minimum needed for food and shelter.

References

DSW. (1995). 'From Welfare to Well-being'. 2nd Edition.

Rifkin, J. (1995). The End of Work: the Decline of the Global Labour Force and the Dawn of the Post-Market Era. Torcher Putman, New York

Stephens, R., Waldegrave, C & Frater, P. (1995). 'Measuring Poverty in New Zealand'. Social Policy Journal N Z.

Triggs, S. (1995). 'A New Model to Forecast Prison Musters'. N Z Criminal Justice. Quarterly, (11).

Ian Ritchie, UBINZ
C/- Private Bag 11 042
Palmerston North
NEW ZEALAND
ian.ritchie@psa.union.org.nz

ABOUT IAN RITCHIE